Everything I Learned About Business, I Learned from Donald Trump

Donald Trump has been a larger-than-life business icon in the United States for over 30 years. He has been held up as both the model of corporate success and as an example of what is wrong with America . His recent contemplative bid for the White House has shone a light on the man and his business practices anew.

In the course of my business life, I have learned a lot from the Donald. I have learned what happens when unbridled greed and entitlement is coupled with hubris and risk addiction. I have learned that often those who crow loudest about the beauty of capitalism and the evils of government have no moral qualms about using the court system to protect themselves from their capitalistic consequences. I have learned what not to do as I conduct my business life. Here is a run-down of what Donald Trump taught me:

1. Never look to win by making others lose.

The simplistic (and incorrect) view of capitalism is that for one side of a deal to win, the other has to lose. In reality, the best business deals involve wins for both sides. Finding what the other party needs and how to give it to them is the best way to get what you want. It also makes it more likely that others will do business with you again. Donald Trump, on the other hand, is famous for nickel and diming his business partners, his employees, his suppliers and his associates. He has made millions on the backs of his corporate bond-holders, who lost much of their stake in Trump's companies in bankruptcy.

2. Don't engage in more risk than you can absorb.

A wise entrepreneur constantly assesses his risk position. With every new deal, the potential risk exposure is re-evaluated and the business owner has to decide if he is in a position to absorb the risk if the deal falters. Trump takes on risk that he cannot absorb. The best example of this is his push to finish the Taj Mahal Casino even though he was teetering on insolvency. The only financing he could obtain was high-interest junk bonds. Unable to pay interest on the bonds, the Taj Mahal filed for Chapter 11 bankruptcy. Trump lost 50 percent of his ownership in the project and the bond holders lost hundreds of millions of dollars.

3. Learn from past failures so that they are not repeated.

Almost every successful entrepreneur has some history of business failure in her background. Business failures teach you more than the successes do. The trick is that you have to study the failures and learn what went wrong and how to fix it next time. Donald Trump never learned that basic business lesson. His business model has always been based on highly-leveraged real estate and it wasn't until most of it was taken away from him through insolvency and bankruptcy that he began to focus on licensing contracts. The real estate he has left is still highly-leveraged and susceptible to going underwater if the real estate markets get worse.

4. Never act like you're the smartest person in the room.

The Donald fancies himself a brilliant businessman. He reminds everyone of that every time he is in front of a microphone. Truly successful business owners know that success isn't a one-man operation. Surrounding yourself with the most experienced and clever advisors will help catapult your business into the stratosphere. If your main goal is to look smarter than everyone else, your business will suffer as your advisors fall silent.

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